NU Online News Service, Jan. 21, 2:07 p.m. – The National Conference of Insurance Legislators, Albany, N.Y., is requesting that Sen. Charles Schumer, D-N.Y., reconsider his introduction of an optional federal chartering bill, the National Insurance Chartering and Supervision Act.
In a Jan. 16 letter to Schumer, state Sen. Neil Breslin, D-N.Y., chair of the NCOIL State-Federal Relations Committee, writes that dual state and federal chartering of insurance companies “would have severe cost implications to taxpayers and consumers. It would hurt ongoing and successful state initiatives aimed at making state regulation more efficient.”
Breslin writes that the bill could force New York taxpayers to make up for much of the $700 million a year the state now collects from insurance premium taxes.
“I believe that your colleagues in Congress will no doubt hear from legislators from other states because your legislation also threatens the $9.7 billion the states now receive annually in insurance premium taxes,” Breslin writes.
Breslin refers to the work that states have done to come into compliance with the Gramm-Leach-Bliley Financial Services Modernization Act of 1999. One section of the law seeks to lower state-imposed barriers to entry by insurance agents from other states.
Breslin notes that 38 states have responded to GLB by enacting laws or regulations implementing the Producer Licensing Model Act, a model act from the National Association of Insurance Commissioners, Kansas City, Mo.
Additionally, Breslin writes, since 1995, 22 states have adopted some form of commercial lines rate and form filing deregulation. Most of the deregulation efforts have been based on a 1998 NCOIL model, the lawmaker says.